The 'startup' that offers subscriptions to rent clothing is already a 'startup' unicorn

We are all used to renting a home or a car, but to date it was not usual to rent clothes.Leaving very concrete garments like smoking, which have always lent themselves to go to events, nobody can rent the daily clothes.But like so many other things this is changing.

According to the consultant Allied Market Research, globally it is estimated that the clothing rental market will reach a turnover of 1.900 million dollars in 2023.

There are numerous companies that, thanks to new technologies, offer to rent for specific periods a huge catalog of garments, but among all of them stands out the runway, the 'startup' that dominates the market in the United States and that has gone beyondNo other, offering the first clothing subscription service.

This "fashion netflix", as they have rushed to baptize the media, allows to rent up to four garments at the same time for $ 159 per month, which in practice allows users - for the moment the company focuses only on fashionfemale– have an “infinite closet”.

In 2016, Rent The Runway generated sales worth $ 100 million, according to market reports.The company has not shared the volume of subscribers or current income, but ensures that its customers grew 160 percent last year.

The model is undoubtedly a success.The company has reached this week the status of “unicorn” - the label that is granted to companies whose valuation amounts to 1.000 million dollars before going over - after announcing the collection of $ 125 million in a new financing round, which adds to the 337 that had previously achieved.

As Elizabeth are explained in ‘Fast Company’, after the latest investments the CEO of Rent The Runway, Jennifer Hyman, becomes the select club of women owners of "Unicornios", which has experienced a significant increase in recent years.

We talk about companies such as Stitch Fix, a subscription service to surprise of clothing;Houzz, a social network that revolves around decoration and interior design;or Glossier, which makes beauty and skin care products that insists on "democratizing beauty".Companies, all of them, created for women thinking about women.

This also emerged rent the runway, founded in 2009 when Hyman had the idea of offering expensive luxury dresses to rent, so they didn't have to buy them.Hyman worked on the project with his classmate at the Harvard Business School Jennifer Fleish and only seven years later, in 2016, the company was already profitable.It was that same year when the company released its subscription program, which has revealed a success.

"We know that this main use was going to work, due to the financial tax imposed on professional women to have variety in their costumes," Hyman explains in 'Fast Company'.But the service exceeded all expectations.Women began using unlimited service for much more than clothing in office.Subscribers wear clothes on average 120 days a year and rent everything: sportswear, for pregnant women, to go on vacation, even jeans and sweatshirts.

This allowed the company.

This has always been one of the main business obstacles.Apart from the obvious logistics challenge that involves collecting, cleaning and distributing the garments, the company has had many difficulties in closing deals with brands that believed that renting their garments would damage an image of carefully cultivated exclusivity.But the company has assured 'Business of Fashion' who is signing contracts with about 100 new brands every six months and has obtained remarkable names such as Marni or Proenza Schouler.The number of brands available has been bent in the last two years.

To date, rent the runway operates only in the United States and has no plans to expand internationally."There is a huge market here that we have even started to explode," says Hyman Business of Fashion.But, although it is one of the pioneer brands, it is no longer the only.In the United States, the company competes with Le Tote and in the United Kingdom follows a similar Girl Meets Dress model.

In Spain, Ecodicta operates, which offers a subscription service, but with a great exception: you do not choose the models, but every month is the company that selects a series of garments that you can use during this period.After these days you can return or buy them.

As usual, Rent The Runway also has its Chinese version, Ycloset.In his case, the greatest difficulty has resided in convincing its clients that they thoroughly wash all the garments that return them, in addition to insisting, like Ecodicta, that the rental of clothing is a more environmentally respectful alternativeWhat to buy garments for right and sinister just to be able to have a variety.

What is clear is that the subscription services for clothing have come to stay, and the objective, such as the majority 'startup', is to change everything. Hyman no se corta y asegura que quiere “poner a H&M y Zara fuera del negocio”.We will see.